The Carbon Budget: Too Little, Too Late?

Prime minister Gordon Brown, promised that this was to be a "green Budget". From an environmental point of view, it did contain a world first: the UK has set its own legally-binding 'carbon budget', to reduce emissions by 34 per cent by 2020.

It's a welcome move, even if it's not as ambitious a target as hoped for by environmentalists and climate scientists.

The real question how government will set the policies necessary to deliver such cuts -- and what they will mean for the business community.

In the rest of the Chancellor's Budget, there wasn't much evidence of the kind of ambitious steps necessary to transform the UK economy in a low-carbon direction. His support for low-carbon industries, advanced manufacturing and energy efficiency measures are all welcome.

But the spend --Â£1.4bn in all -- just isn't enough. We're moving in the right direction, just not far or fast enough.

Considering the money thrown at dealing with the financial crisis, spending on averting the environmental crisis is still woefully inadequate. The UK remains near the bottom of the global league table for green stimulus spending and is not yet on course for the transition to a low carbon economy.

Which leaves us with the question of what the government needs to do next in order to meet that new 2020 target and avert a climate crisis that will dwarf the financial crisis in terms of cost and impact.

We are likely to see further support announced for green technologies and skills over the coming year -- money allowing.

But the government will surely have to get serious at some point on carbon pricing. There was no hint of this in the Budget.

Although the Chancellor increased overall taxation, there was no strong move to increase tax on the things we want to discourage, like pollution.

There's still a gaping hole in government finances and an urgent need to decarbonise the economy, so we may yet see a more serious green tax shift.